we are live from the marketsite in times square. i'm becky quick along with andrew ross sorkin and joe kernen let's check out u.s. equity futures as joe mentioned big up day for the markets the dow gained 1,173 points but this morning, it is giving back about half of that dow futures indicated down about 577. s&p indicated down about 74, the nasdaq indicated down about 224. at this point, the treasury market is back below 1%. the 10-year to 2-year spread, it could be a sign of what would be coming with the potential recession is now down by just over 3% this morning

in europe, also watching what has been happening there, you will also see just like yesterday europe is down across the board. the biggest declines coming from france and london. the cac off 1.6% among the big market themes, momentum stocks outperform, some momentum factor er, etf up on pace for the best ever launch since 2016 >> we are going to have a technical analysts on. i was distracted i asked the analyst whether it works like this with the

outliar. they insist, no matter what, they did bounce off the level. the ones they mention. it hit exactly and bounced off it we have bleakly here >> let's say this, we manage 6 billion of assets. we want that to go up. it is risk management. we need p emto worry. >> we have a lot of them around

today. including me burgon county, the first presumptive case of coronavirus. energy is in a bare market off from its high in april industrials also in correction territory. >> gold on pace for its best performance. looking at prices this morning, you'll see they are up to 1,674 an ounce oil is attempting to cut production to stem the market,

which has been under pressure. people assume the economy is slowing worldwide because of the virus. wti is down. as we've been mentioning, cnbc contributor, good morning to you help us with what you think transpired >> we had the federally monday the fed is panicking, sell up tuesday. okay, the fed is back stocking up the biden win helping health stocks an everythi stocks and everything will be okay until the virus count plateaus >> it hasn't even picked up at

this point >> we are worried about where it goes from here t of the world matters. south korea has another big number of cases. china, every time we think th r thathaf they've handled it >> in italy, we saw a decline when they closed the schools >> we are close to 30,000. it is just a number but also shows you things are really volatile >> people are flying blind human nature, you are going to get these emotional swings now sto china, you look at the

johns hopkins website. we have 1.4 million people and we are obsessing about the 80,000 there is hysteria here but has real world impact. it is a run on the bank essentially. >> or the grocery store. >> exactly the fed tries to believe they can somehow cushion us do you think it is a fiscal package? >> occurring the virus, that is the stimulus >> do you think we'll get to the point where we are stemming the

travel, the airlines industry? i had my eye on hong kong and singapore because it is getting warmer >> if things do get worse, we won't be standing in medicare for all lines like the va. >> i talked yesterday to lloyd

blankfine. >> are you name dropping now >> i am. we were saying yesterday was strictly political day >> both of you were talking the book >> no. we weren't talking the book. >> on monday, there wasn't any news and what about hft, what is that >> but health care stocks led the way. >> this flipped faster from 70 to 10 it was 70 bernie, 10 biden. >> that day that will live on.

>> it is faster than the dow this week. always finds a way. >> it is funny that medicare for all line >> do you really want to see the coronavirus outbreak >> the question is what will we do when we come back from the break? >> the question is this, the longer this goes on, the bigger it gets, the issue of health care will become in america, no question or no doubt >> that's wrong, the 170 million

provided with private insurance. how many people are not covered? >> we would like to see the people who aren't insured tested for free on this. that's what we would like to see happen >> health care is going to be a massive issue. >> you have no solution, just criticism. when we come back, more on the coronavirus outbreak the best performing today, johnson&johnson leading the way. then merck and united technology you are watching "squawk box" on cnbc these days you need faster internet

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welcome back if you are just waking up right now. take a look at futures dow would open off 514 points down actually gotten marginally better there s&p 500 off 67 points and nasdaq off 203 points want to talk about the latest of

coronavirus. california declaring a state of emergency as the number of cases skyrockets to more than 50 the spike is linked to a cruise ship that returned to san francisco from hawaii. in new jersey, reporting the first presumptive case making it the 17th state the house approved a $8 billion spending bill in response to stem the outbreak. the president has indicated he will sign it into law. more than twice the amount president trump originally requested. >> our guest, he led the u.s.

response to ebola. thank you for being with us. can you tell us where things stand now. they are saying it is a 4.3% mortality rate >> this virus still seems to be on the upswing in the united states and worldwide i would sound a note of caution. i think the figure was 3.4 yesterday. we don't know the denominator yet. in general, we do see a decline. we now have indications in multiple metro areas, greater seattle, the bay area, l.a., new york city and a number of other states we still don't have anywhere near full visibility on total

cases in the u.s what we are seeing is probably just the tip of the iceberg. >> in china, when they first started reporting, they shut down the entire province we are not going to see those shut downs here because of civil liberties, correct >> i don't think the oous could or would want to do. in seattle, they are doing social distance being measures to keep people from interacting in higher risk ways. canceling gatherings, advising people not to use transit, microsoft has advised people to work from home for the next three weeks. >> we are now looking at what

china did because it was so extreme, it probably kept it from getting around the globe faflter. it bought us a few weeks if the united states is not going to do those measure res, does that mean it will spread in the the united states. >> the question is how far, how fast can we keep that spread to a manager rate so it doesn't overload hospitals that's the hope going forward. the challenge, we don't know how best to apply the best from china. china took a sledge hammer approach in other areas they've taken a exact scalpal approach the u.s. approach will be

somewhere in the middle. we have not heard any clear plan from the government of what p that looks like. still claiming he think there's is only 100 cases in this country. >> that was the point made that this is being left up to the local authorities. new york authorities being more reactive frmt. >> you want to have a consistent approach you don't want some areas stronger and others weaker that's where we are heading right now. i worked on the ebola response in 2014. we saw at the outset, we left a vacuum we began to see on things like travel measures, states began to freelance. the government stepped in with

guidance and the states got on board and we had a consistent national approach. we are not seen that yet despite the fact that it is posing a far larger threat than ebola evekee level that u.s. health care can handle what is that level >> it is not a very high level a few years ago when flu season hit hard, hospitals were treating people on gurnies and in hallways. we are not out of flu season we are already hearing from seattle that just with the 40% to 50% cases identified, that

has put a strain on the health system there >> thank you for your time today. he's the former director thank you for your time. reuters is reporting opec ministers have agreed to an oil cut of 1.5 million we will have more from vienna just ahead coming up, how much mike bloomberg spent on his run and the implay indications did he spend more? >> i think he sment more he's keeping his staff until november >> call it the biden staff that's what it is now. >> half a billion just on

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if you are just waking up, check out the u.s. equity futures. yesterday, you saw a gain of more than 1,100. right now, down about 560 points s&p off by 73 and the nasdaq off by 220 the two-year note sitting at 0.968% former new york city mayor mike bloomberg ending his bid for president. a costly bid adds bought for halfy billion. robert frank with us he could have bought a couple of really nice sports cars.

>> he spent over $500 million just on tv and radio you add in digital adds and offices. total likely $600 million making it the most expensive self-financed campaign ever. he spent twice the total number of trump, biden, buttigieg and sanders. $300,000 an hour what did he get for it he got 24 delegates, over $222 million on super tuesday ads that return was close to $10 billion per delegate compared to biden who spent about $5,000 and bernie sanders who spent about

$26,000 per delegate he can spend whatever he wants now in support of biden. local broadcasters have benefits but to his spending. you'll not only get bloomberg wore biden to continue to spend. biden wasn't spending through this now you've got essentially two candidates in one spending >> that's the benefit. >> and he got samoa. >> it was pointed out, he spent the equivalent of the samoa gdp. >> he said if he got the nomination, he would try to sell his company. >> if he became president?

>> were there any expressions of interest buffett was always the name. he came on air with becky that said absolutely not he knew that someone would pay more that was the big question they dominate. all of the staff that went from bloomberg to the campaign can all return and go back to work >> you can't win the presidency with independent >> and ross perot. >> his point was he didn't want to split the vote and draw away

from the democratic vote >> it was not a miscalculation that a billionaire never gaz going to incur this was two campaigns one to nominate bloomberg. the second is just get rid of trump no matter what it takes. people saying this was a failure, we don't know yet if it gets reversed, and sanders becomes the nominee, i can't imagine the must be that would have been for biden being there. >> right were you surprised were you surprised he ended that campaign >> the reason he ran is because he didn't want to see bernie

sanders in that. >> have you looked at the betting markets? >> you've seen where bernie is >> what is his number now? 18 cents >> 18 cents is not if bernie comes back, he's not coming back he jo is 75. everybody said we thought biden was bad >> everything else this is not going to change. >> bernie sanders said he would support or bow out if joe biden got a plural backing >> they changed the rules with the super delegates. >> they also changed the rules to let bloomberg into the debate >> this is the grassroots,

democrats over 35 that are voting and will put biden in as the nominee. we'll see. >> we have a lot more coming up. when we return, continuing coverage futures hitting session lows the dow now indicated down about 600 points in beijing, companies and workers are trying to return to normal all of that. take a look at yesterday's s&p 500 winners and losers ♪

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good morning and welcome today's top story, we have another global market selloff. we'll show you what is going on. we are in the red across the screen looking at the dow down if it would open down about 625. s&p down about 81 and the nasdaq down about 237 points. the 10-year yield under 1% at .965. china is attempting to return to work after the outbreak first hit there

eunice yoon is live. >> the commerce has been talking up the resuming of work. releasing shipping or manufacturing areas that topped 70% or even reached 100% i noticed walking around today, business is coming back, sort of >> i'm sitting at starbucks, which i couldn't do before today. i had to get a temperature check and log in sitting with my colleague who is six feet away. my commute is light. traffic cops are out foot traffic is more in apple. you have to go through temperature checks and wait in

line because they won't let in too many customers at lunch time, office staffers are eating out >> i quarantined myself for 14 days the food at this mall should be clean. >> what we are really looking for is street food vendors to start serving chinese breakfast. these places are cheap and popular with vendors but still closed >> we are starting to see more pollution days today, the level was only five times the w.h.o.s recommended amount >> i watched what you were treating earlier about some cases that people have been cured and left the hospital. one man died a few days and

others are being reinfected. >> it is unclear it looks as though those people weren't cured to begin with. there is a lot of caution about people being released. this is the first time someone died after testing negative. there has been a lot of discussion and concern about what this means then for the numbers that china has been releasing. >> i still think the thinking is if you've had it once and it were to come back that you won't get it again that's the current thinking. you would assume that if your immune system is at full levels. like if you are a young person or not compromised in a would be bad of course if it mutated

eunice, thank you. when you drink the coffee, do you -- >> do you take the mask off? >> do you drink through the mask >> then it is no longer sealed >> and what if the server has it >> people in the back of the kitchen need to go to work >> i had kind of a freak out at lunch the other day thinking too much >> how do you think they watch these? >> let's not have the question >> we are in times square. >> coming up, we'll talk stay at home stocks and companies benefitting as people shun the office and don't miss sam zell on set first, check out the biggest dow

losers in pre-market trading watch or listen to us live or on the go on the cnbc app the barkins are empty nesters now.

should they downsize? probably.

will they? not as long as thanksgiving is a holiday. planning for the future is about more than just money. let equitable be your guide. got a market match hp rejecting xerox's raised bid.

you don't want to miss hp's ceo on squawk on the street. in the meantime, video conferencing software company zoom, reportedly beat on earnings but dropped as much as 10%. zoom had a massive run up as coronavirus rose fears and had companies working from home. more on stay at home stocks. covering the wireless providers. >> did we just get too excited about these stay at home stocks and put zoom on a list >> still with secular drivers, in terms of zoom this is a stock that would be

70% year to date putting up big numbers that was at most recent count down, probably a win a good outcome >> how much do you wore yoi about competition. announcing that google was going to make google hangouts free because of coronavirus for the next several months. that would be a clear competitor to zoom. and there are many others out there. >> this has been a competitive market for some time taking the share from cisco and other providers with just an easy solution. looking at the those in the institutions >> that the opportunity and part of the fly wheel effect. you bring them on and over time,

they add security and usage, you bring them out as paid users one of the comments made, they are seeing a surge in demand in china. only one or two weeks, have they started to see the surge in the u.s. >> questioning the valuation prospects very bright. seeing the company valued three to five times in revenue >> a good question no question, this one is at a valuation premium. the way we look at it is, this is a platform. we are talking the video conference today also moving to a zoom phone. the interesting thing, this is rare tied air. they go at 80% you can't find profit margins.

they've still got these new products on the horizon. >> what do you see there >> the real opportunity there is to replace your phone systems. they are trying to replace those names like vonnage that we know. going after the cloud based solution that provides more at home from the field. >> what other stay at home stocks do you like >> we like the slack story on line team messaging >> do you think slack stays independent? >> i think we are assuming it does we are not aware of a buyer. long term, they could be rolled up ring centrals, the eight by eights, the vonnages >> another interesting thing

i was with an analyst with a company called the ucla lab, you can test your speed. they are seeing stresses globally that leads up to names to help speed up internet access >> thank you we appreciate it when we come back, dazed and confused by market swings, you are not a low. dow indicated down 575, nasdaq off by 220 and s&p off by 75 "squawk box" will be right back. at leaf blowers.

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stocks surging yesterday on the super tuesday results, pushing all three major averages out of correction territory. the s&p rose more than 4%. stocks thumping today after democrats are realizing they might actually have joe biden as their nominee. to decipher what's next for stocks i'm joking i'm joking i'm joking i mean, but yesterday all the news flashes it's up 1,000 today it's like, wait a second, really now the market is like, uh-oh. >> i don't think that's -- >> okay. all right. i get that just to show both sides of the coin. both sides of the coin just trying to stay fair and balanced. >> fair and balanced

>> kate stockton is here arguing with me or arguing a point that technicals still matter even with an outlier a black swan, whatever you want to refer to. >> now more than ever. >> if you're a managing partner, now more than ever. >> yeah. >> to some people it's like if there's something so unexpected that all bets are off. but you're saying that poor resistance already factors in the sentiment of what people are responding to. >> it is all about sentiment, right? corrective phase cannot be explained using fundamental reasoning. that's where the technicals can come in so handy so at least we have these tools to help us understand and get back in. >> what is this? >> this is the spiders the s&p 500, eft >> what does this show >> you can see the massive corrective phase notice this it has come into a breakout point let's call it 300 for the s&p spider and in this region here, as you

can imagine, quite oversold. and what's been important about this week is that we saw an immediate reaction to that oversold condition which was the greatest oversold condition since december of 2018 by my measures. >> that horrific december we had. >> that's right. >> seemed so recent but it's already 3018. >> it increases the likelihood that it's a shakeout now, we won't be convinced of that until we get a nice close this friday. so far so good today could be variable. as long as we close 3030 s&p 500 i would feel good about that. >> we keep asking the question and pointed out, so every year the garden variety correction, 10, 12, 13% is a pandemic only good for a garden variety correction and are the lows in? and this is what we're trying to figure out here. >> that's right. so we have been through viruses before and it has been a buy-in

opportunity. not to minimize what's going on in this environment, but we're seeing extremes like i said we hadn't seen in some time so this is the percentage of stocks and the s&p 500 that are oversold from a short-term perspective based on one of my measures so very common measure at that notice, of course, the peak is quite impressive usually peaks around 50% that's like the october low, the august low, et cetera. those sort of minor lows at major lows we tend to get these really extreme readings and associated -- i know peter is here with very, very bearish, meaning from a contrarian perspective, you could actually have a positive take away from that. >> that's a good one and then this is an individual issue that may be ready to break out and one that would be fundamentally tied to what happens with this situation. >> good sort of case study, i think, in terms of the correction that we have already seen like the spiders. we have a pullback or corrective

phase down to former breakout -- >> walmart. >> very natural place for walmart to find some support in here it looks like it's already happening. we have some signs of down set exhaustion based on the oversold measure. it underperformed in q4. unlike some of the tech stocks still look relatively over extended to me, this was relatively oversold. i think that positions it better irrespective of how we come out of this. >> right katy, thank you. great to have your analysis today. we appreciate it all right. andrew >> thank you, sir. appreciate that. i have a joke for you but after the break. >> okay. all right. >> there's a tease legendary investor sam zell will join us live on the set in just a little bit as wall street looks to get ready for another wild trading session futures pointing to a sharply lower openff o of a 500 points right about now on the dow stay tuned you're watching "squawk box" on cnbc

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♪ volatility reigns supreme with the dow coming off its second 1,000 point gain in less than a week. futures are telling a different story. possibly putting wall street gains in jeopardy. we're going to talk markets,

real estate and the risko credit markets with guest host and legendary investor sam zell. the number of u.s. states with reported coronavirus infections ticking up to 17 with one declaring a state of emergency. the latest on the spread of the coronavirus and the impact on the markets as the second hour of "squawk box" begins right now. ♪ good morning welcome back to "squawk box" right here on cnbc i'm andrew ross sorkin along with becky quick and joe kernen look at the u.s. equity futures at this hour i have a smile but i shouldn't look at the red. dow jones looks like it would open down about 560 points right about now. s&p 500 looking to open down 72 points nasdaq looking to open down about 215 points after a big up day yesterday. now take a quick look at the

ten-year note. this has been one of the all important metrics we have been paying a lot of attention to, still under 1% we're .978 i have not called my mortgage broker but maybe i should. let's show you oil because that's been a huge factor here as well. crude now trading 46.71 if you want to buy by the barrel. oil trading in bear market territory. opec ministers agreed to an oil cut of 1.5 million barrels a day. russia set to agree in principle but not on the number itself opec will hold a news conference tomorrow at the opec and so-called opec plus countries meet so, i think the market follows -- if you think the stock market follows the energy market. >> everything follows the ten-year but i think it's now we're sort of just looking at everything. and you know, each day that goes by we become more experienced

that -- it's been since 1918 i never -- i hope that -- >> global pandemic. >> yeah. we haven't -- bill gates has for years worried. they do simulations about something novel, not a single immune system in the entire world that's seen it you wonder how -- at this point we still don't know if this is totally different from h1n1 and sars and all the other four. is it one of those outliers. we're dealing with it everyday and so is the stock market in the past eight days, there have been four more than 1,000 point swings in the dow. the most 3% plus moves since 2018 let's welcome today's guest host sam zell, the reason he likes real estate, chairman of equity group investment and billionaire real estate investor

who needs this, right? i mean, walk on your property everyday, looks like it's worth about the same, right? >> yeah. >> unless it's now it's a restaurant read or something like that, there are kind of -- >> or a hotel. >> or hotel itself what do you make of all this, sam? and you have been around a while. and you understand human nature. are we gauging this correctly? or too much or too little? >> i think it's too early to tell i think that so far it seems to be maybe more excitement than reality. i mean, we're a country of 330 million people and we're talking about ten deaths and we're talking about 100 people having the virus. i think the real question is what will it be three weeks from now? that's really when we'll know, i

think, whether we've got a really serious problem or just a spike problem. >> unfortunately by then it will be too late if we have a serious problem to try to contain it because of the two-week incubation period. >> i think we have to do everything we can to contain it. having said that, i don't have a lot of confidence that we have the ability to contain it. so, i'm looking at the other way and saying, we can't contain it, you know, what's the reality and the reality is call me in three weeks. >> right. >> and i'll tell you whether we got a problem that's limited to iran and china and -- >> italy. >> -- italy and south korea, or do we have a problem that's going to be covered throughout the world. >> so we write off the china, china may be nasen success in dealing with it. we can't take any sauce from that for the first time in history

it's like wow those communists are good at something. >> 60 million people and saying you can't go anywhere. >> we can't do that here but maybe if it works over there, can we take solace that maybe we can handle it or say we can't handle it because we can't do what they did >> we take solace at the numbers we're getting now are better. >> the market has looked a little bit at that that china isn't at 1 million people right now they have 1.3 billion versus our 330. they have, what, 80,000 total. >> 80,000 total around the world. >> around the world. >> that's a smaller number. >> china is maybe 60,000 again, that's really in a country of 1 billion, 400 million people, that's not a very big number. >> have you done anything differently, a, because of the coronavirus or, b, because of the market volatility that's happened as a result of this

>> i think in terms of the market, i think we've -- we have been buying some stuff that we thought was ridiculously low and but not a lot. certainly every travel decision is rethought. >> yeah. >> i mean, talking about a crisis, our yearly motorcycle trip is in two months in italy >> so what are you going to do have you cancelled >> we literally are getting everybody to talk about it i don't think we go to italy >> and when you sat down here, none of us shook hands around the table. >> but the trouble is, we didn't shake hands. we grab the handle on the door and open the door. >> right okay so what did we accomplish by not shaking hands? >> i don't know. >> yeah. and then you push the elevator

button >> with my elbow. >> you read you're not supposed to touch your face. >> i know. >> son average you touch your face 24 time ss s an hour. >> the inside of your nose count as touching your face. >> yes, it does. >> then i have a problem. >> did you see president trump >> yeah. that didn't -- i saw that people, like you, were up in arms about that. >> i wasn't up in arms i thought it was funny. >> someone said -- i saw someone tweeted out this is what our commander in chief, this is how he leads a meeting with ceos by talking about touching his face. like it was the worst thing -- the trump haters. >> made a joke about how hard it was to not touch your face >> i thought it was funny, too but it is a very serious thing if you hate trump, you're going to figure out a way -- any way when is the motorcycle >> end of may. >> end of may. >> british columbia is nice, right? >> just riding a motorcycle, what do you need to go to italy

for? >> what about montana? >> the problem with montana is it's long distances. >> you're riding your motorcycle, sam. what do you want to do, go 5 miles and get off it. >> you want to do twists and turns. the measure of a good motorcycle trip is how few miles you go straight >> interesting >> everything -- that's why europe is so good. that's why ashville is so good >> go drive around the city of boston >> actually but then you have traffic. >> even better >> and potholes. >> yeah. >> you don't want traffic. you want pretty views and you want turns and twists and turns all day long. >> sam, what have you been buying that you thought was really cheap based on the market >> well, there have been a couple of companies that we have significant ownership interests

in, one in the energy space. and we've been buying that stock because it's got on the the point where it doesn't make any sense -- >> you don't want to disclose which name. >> no. >> understood. >> i'm not doing that. >> but i think we're looking at everything else. everything else there are a couple of energy space has just gotten killed. i think unjustifiably. >> yeah. >> so i think that we have seen some extraordinary changes in pricing in the energy space, much less so than everything else in the recent once again proven that they were really resilient. and in the ones that we control, we went down with first 1,000 points, but they're almost back to where it all started. >> you're really, really liquid, aren't you >> yes yeah >> why wouldn't you --

>> that's why i think the stock market can't go down >> right. >> because there's -- >> only goes down when i'm liquid. >> opportunistic. >> why aren't you all over the energy -- or have you looked at a way. >> we have been spending a lot of money in the energy space and think the energy space is very cheap. and there's no money i mean, despite all this conversation about liquidity, there's no money in the energy space. >> that lets you be really opportunistic. >> it helps that we weren't in the energy space before. see, an awful lot of people would not disagree that the energy space is cheap. but they're saying i'm already up to here in energy i don't need anymore >> how would you do it, sam? what type of thing would you buy debt >> given a choice, what we want to buy is existing production.

in other words, you don't want to drill you don't -- how riskless can you play the oil business? and i don't think the least riskless way to play in my opinion, is buying production. >> so are you thinking about this everyday? do you have people working on this >> oh, sure. sure. >> how long were you watching that beforehand, waiting for something like this. >> we monitor all kinds of different markets and obviously the energy market is one we're always keeping track of. and, you know, it started getting really dicey about six or eight months ago. all of a sudden you saw that stuff that would normally, you know, get sold very quickly. no bids. we just won a bid on a bankrupt company where we were the stock

bid and then they had the auction and nobody came. i think that's more the rule today than the exception. >> i'm speaking with darren woods later today the chairman and ceo of exxonmobil. and i think it's interesting what you say about how you want to buy existing production, not guys out there who are drilling. >> that's right. >> you think it's a smart play for some of the big players to kind of be reigning in what they're doing in additional drilling and kind of be waiting or no? is it different with the big boys >> i think we look at the oil business, you have to distinguish between the big guys and the rest of the guys. >> right. >> the big guys are running, you know, different ratios and may have billions of barrels of production and hedging off of it and they're doing all kinds of stuff that little people can't do so i wouldn't -- i think the challenge for exxon is very different than it is for the average expiration company,

particularly ones that have been created in the last ten years. >> sam will be with us for the rest of the show vermont. i'm getting notes about vermont is a great place for motorcycle trip >> good ice cream. >> but there's police in vermont. >> now, this is because what you're doing when you stop the motorcycle >> oh, no, no, no. >> okay. that's legal most places now >> oh, okay. >> so that's one of the beauties -- >> colorado. >> and totally

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welcome back to "squawk box. real estate is a favorite of th super rich robert frank is back at the table this morning with a look at where the wealthy are buying >> good morning, andrew. 20% plan to buy real estate this year and the u.s.çóis theire favorite ñiestination the u.s. is the number one country from wealthy buyers from asia, australia, latin america and canada last year the çbest-performing market in the world for prime real estate was frankfurt f

germany, followed by liz bain and jtaipei vancouver was the worst minated by chinese buyers abu dhabi was hit by oversupply of high-end homes. new york, london and the hamp n hamptonsl among the ten worst performers last year monaco is the most expensive city in the world on a per $1 million only gets you 162 square feet of space in monaco 1 million buys you 226 square feet inñirhong kong and 334 iw york leastw3expensive town, capetow south africa, $1 millionw gets you 1,800 square feet. >> why so much cheaper >> it's south africa >> i love it so much. >> the favorite city in theq world among the super rich based one the lifestyle, investment climate and population of other rich people is new yorkçófollod by london.

now of the top ten cities favoritew among the wealthy, eight of the them, eight of the top 20 are in the u.s. >> wow, i didn't know that you look at size for cities, u.s. doesn't show up anywhere. >> l.a., san çórancisco, miami, what else? >> on a per square foot million? >> what are the top eight. >> so, chicagoe was up there. chicago was next closest san francisco, l.a. >> washington, d.c. >> miami i don't think was on there, no. >> not dallas or houston çóith? >> i don't think so, no. >> well, houstono:price performance was very high. was up 7% last year. >> howard lorber the president and ceo of the vectorfá group a chairman of douglase1my edelman when you look at around the globe where you want to invest, what jumps out to you? >> what jumps out to me is vancouver was a good example, up, up, up until they put taxes

on it and now it's i]down. the re-adjustment is happening you have to be careful with that but it's interesting to me that when you look and you say the worst performing cities price wise were london and new york, ande1 two in the index as to whe people want to be. that's based on xlivability, obviously government, taxes, culture. so people still want to be there. so i guess what you would look forward to is appreciation in those markets at some time new york specifically was hurt thisw past year because of the mansionqtaxes andthe other taxes that they're stillte tag about for new york city l (t&háp &hc% >> so taxes obviously have a big &há% what about coronavirus, does that change the picture at all >> we haven't seen yet, in fact, we were talking earlier, shocking that our open houses that brokers have on weekends are packed >> once place you see crowds.

>> maybe they want to get out and think that's a safe place to go so it's pretty busy. there.he reads are hanging in why do you think that is, sam? >>t i think first of all the rates are underleveraged real estate historically has been al 60,f 75% ltb kind of business you know, equity residential is 35%.f equity vice house is 25% í of other companies are all, you know, much, much less leveraged than they have been the past i think from ae trend point of view, it(think that -- no argument about the number one uqás, but i think more and more affordability is more and more of a challenge and i think that, you know, smart real estate investors are going to kind of focus on where do you

go if you can'tqafford new york or if you can'te1 afford london? nashville? is that austin is that madison, wisconsin. >> those markets are almost overheated you look at the price growth there and they're quickly becoming less affordable >> they're quickly becoming less affordable but they have the one thing necessary too dealok with affordability -- >> space. >> and that's land. lye >> and they have lots and lots of land. so -- almost by definition even though prices in nashville haveq gone up a lot, still anñiabili to catch up. thee1çóproblem in california a the homeless problem is thatñ u have legislative impediments to creating housing supply. and soj you created perpetual environment ofeo shortage whik creates the highest prices in

the country. >> aside from affordability, you have the wealthy going to florida because of the salt tid changes and in california going to colorado, texas is your whole business changing to focus on those lower tax states where people want to move >> first of all you have to change because it's happening. if you look at our volume > that's what i wonder. what is thatw+ tipping point >> no one knows until it l happens. >> yeah. >> right now with thee1 legislature talking aboute1 pet

tear tax.u if don't file state and city tax and have anotherémansion tax except it would be annual. >> we have to go on all the time because you were a close friend and backer of the president. any comments, have you.talket him? how is he feeling? is he excited? whoe1 does he want to face, bid or bernie? >> i don't think he cares. >> have you ever lobbied him on the salt tax. >> yes we had it in the beginning i think it will be looked at again. >> you think itt(will >> i hope so i mean, i can't imagine he will. op. i think salt is just the first step in just general, 16 years ago that canada eliminated mortgagee deductions? everybody said oh my god the end of the world is going to come. >> bloomberg were goinglp to be

presidentxdwe would talk about salt, we would need something different. you would have to start to like pepper. coming up, equity and bonds coronavirus. could the credit markets be next we'llt(discuss.o plus, new cases of coronavirus in new york overnight ande1 now new jersey seeing its firste1 confirmed case we'll speak to ane1 infectious disease specialist when we return. >> announcer: time now for today's aflace1 trivia question. what was the first country in which tesla's del mos topped the monthly new car sales ranking. the answer when cnbc "squawk the answer when cnbc "squawk box" continues uh uh. is it homeowner's insurance? no... uhuhuhuh! is it duck insurance? nope. ahhh! do they pay me money directly when i get sick or injured? yeah. aflac! you got it. you know aflac! boom! get help with expenses health insurance doesn't cover. get to know us at... aflac dot com.

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>> announcer: now the answer to today's aflac trivia question. what was the first country in which tesla's model s topped the monthly new car sales ranking? the answer, norway welcome back to "squawk box" here on cnbc we're live from the nasdaq market site in times square. take a look at the u.s. we canty futures at this hour you can see right now that things are significantly weaker. they have been down all morning. we have seen lower levels than this the dow futures right now indicated down by about 525 points after gaining more than

1,100 points yesterday s&p futures down by 67 you saw nasdaq was down by about 200. we're also watching the treasury market where the ten year is yielding 1%. again, that's a bit of a fear factor, trying to figure out where people are getting their arms around this and we have been watching that closely in asia, overnight, markets closed higher. gains of 2% for the hang sang and shanghai composite nikkei up 1% europe is following more like our futures are trading, active trading there. see down 2% in spain declines of 1.6% for many of those other markets. we'll have much more from our special guest st tay shoodam zell when "squawk box" comes right back

this morning the coronavirus has affected equity and government bond yields but do investors need to worry about underlying debt. that's a question that persisted these past couple weeks. steve liesman joins us with perhaps the answer steve. >> thanks, andrew. top executives at all three credit major ratings tell cnbc they're closely monitoring on

corporate, municipal and sovereign debt a handful of rating reactions directly related to the outbreak but that is expected to change over at moody's they told me, something we're monitoring very closely. s&p said there will be more ratings access and the pace will quickly. s&p changed 27 credit ratings bauds of it. it placed sampson niet negative on monday and earlier flagged saber and wind that's attracting the most scrutiny other companies in travel and tourism in countries that rely on the revenues to service the debt commodity companies also being watched carefully with countries relying on commodity revenues. concern is not focussed on investment grade a lot has been refinanced, turned out at lower rates into the future the main worry is speculative grade debt that should raise the red flag for investors going down the credit ladder hunting for yield.

there will be credit risk in there. as the virus spreads to other economies including the u.s., leveraged corporates may find their production disrupted considerable liquidity in the count country. some spreads widened, rates have fallen so that eases the burden on corporate cash flows and some companies countries could get relief from government agency bailouts or imf or the world bank if those programs are passed but it's also true the economic effects remain unknown head of analytics and research at s&p told me it's all hands on deck we need to be proactive. we can't wait until the economic effects already obvious. you know what happened the last time we had a crisis, the rating agencies were widely criticized and behind the curve i get the sense they're sort of on their game on this one and really trying to stay ahead of

it and not -- avoid that criticism they had in the financial crisis. >> downgrades constantly >> i think you'll see the first step is not downgrades it's ratings watch negative. >> right. >> i think they'll flag that stuff. you can go, for example, on either the fitch or s&p website and there's a lot of research for people to read and figure out. it's difficult to gain but the idea that more and more of this is happening more quickly, but you have lower rates. you also have this liquidity in the system. >> right. >> that liquidity, you need two sides to make this a crisis. the lenders not to lend and the borrowers to borrow. you need people go in with eyes wide open. there's potential underlying credit issues. >> there's no aig on the other side like guaranteeing rift they don't have any reserves. >> that we know of. >> or is there >> that we know of that was the problem >> let's bring in our guest host

for more perspective on the debt world. where are you looking right now to the extent you think there will be opportunity with companies that may be -- hate to use the phrase bk, but on the verge. >> well, obviously the whole energy area is one that we've been spending a lot of time on you know, despite all the liquidity you're talking about, there's no money in the oil patch. there's no liquidity in the oil patch. >> oil was the first thing to go, even before the virus, right? there were problems in the oil and they have thrown everything out. i was wondering if there was anybody out there trying to find the nuggets, right that was you. >> we've been doing some of it we're very selective and we're basically focussed on existing flows rather than drilling. >> are you doing mlps and trying to clip some of those coupons? those are big cue pons.

>> yeah. but some of the companies -- first of all, i think bk problem is much more attractive. >> bk. >> bankruptcy. >> in other words, come in after bankruptcy and buy assets. >> in today's world, the bankruptcy sales aren't drawing any bidder. >> that's interesting. >> that surprises me that some of the big players wouldn't get involved in some of those situations. >> as i said before, part of the problem is, almost every big player already has a significant commitment to the energy sector. so, even though it may seem very attractive, question is if you're 25% under water, do you want to add some more 50% under water product? >> right would your shareholders be furious if you did it. >> shareholders or just as an individual. >> sam said -- maybe you weren't watching earlier he's buying producing properties in energy. how do you do that, buy the debt of producing companies

buy the equity, land >> all of the above. >> you do? >> we just bought a company in bankruptcy so, we got the whole company >> and they have producing properties. >> we also did another deal with a major producer where in effect we created a preferred position, kind of economics we had never seen before. >> favorable. >> when you say economics -- >> you loaned them money and you got the big preferred -- >> yeah. exactly. >> you don't care if you lost 46, 47, 45 your economics are at a low rate. >> yeah. or there's adjustments in the economics to reflect the price. >> let me just make one more point, sam, which i'm sure you're aware of which is that everybody needs to understand the order of preferred when it comes to a company there is dividends, equity and debt and the debt is the last thing to go. so, when something looks too

good to be true on a stock price or a dividend yield, you have to then question the underlying debt structure of the company. so, people are out there saying dividend yields of 6%, right that may be true but that dividend yield may not last >> well, that's always the risk in any dividend situation. dividend is, you know, the marginal distribution. >> they can stop paying their debt payments, too >> that's what i'm saying. people need to understand the order of things. >> i think they do >> okay. >> all right >> sam will be with us for the rest of the show folks, friends, family and business leaders are gathering at st. patrick's cathedral this mork to pay their respects to jack welch who oversaw a period of tremendous growth at general electric he was also a friend and mentor to many of us here. >> for 30 years. one of a kind, really.

>> the reason why i'm on this program is because he was a guest host 15 years ago and he selected me as one of his guest host hosts. >> guest host hosts, right. >> that's how i met him, the first time i was ever on this program. >> i tried to do the math on how many people you go through until you get a jack welch i didn't get a number. more than 100 million. he was one of a kind. >> you start thinking of the kevin bacon connection >> not that. >> how often does someone like jack come along. >> oh, never never. >> hundreds of billions. there won't be another one, i don't think. any way -- okay. we'll be right back. ks.com! no more lugging your clubs through the airport or risk having your clubs lost or damaged by the airlines. sending your own clubs ahead with shipsticks.com makes it fast & easy to get to your golf destination. with just a few clicks or a phone call, we'll pick up and deliver

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creating a better world isn't just a result, it's a responsibility. emerson. consider it solved. welcome back, everybody. we're watching oil prices this morning along with every other market dow futures down by 571 points wti has been down about half a percent earlier this morning right now, though, it's picking up just slightly wti up by 7%, but that is again a reversal of what we saw earlier this session brent crude up by 4 cents now, too. that had been weaker until a moment ago iran's oil minister confirming earlier reports that opec

ministers have agreed to an extra $1.5 million barrels a day cut in oil production. opec ministers want non-opec state os contribute reductions of 500,000 barrels a day to hit that cut russia still needs to sign on to this the talks between opec and non-opec countries will continue tomorrow and then we expect opec to hold a news conference. in the meantime, exxonmobil is holding an investor conference today. ahead of that meeting we're going to be hearing from the company, just hearing from it recently saying sit planning capital expenditures of somewhere between 30 and $35 billion annually through the year 2025. we'll be sitting down with exxon ceo today and bring you that conversation tomorrow. right now, let's get to dom chu. what are you watching this morning? >> so becky, you indicated the dow will open down by almost 570 points a in the stage. we have some outperformers premarket in a very negative overall take and analyst calls are helping in some of those causes we'll start with shares of

johnson&johnson down to the downside hovering unchanged the drug and consumer products company as well as dow component gets initiated with a slate of other companies as buy rated at citi that's helping the cause only down quarter of 1% you also have shares of snap which are up around maybe half a percent or so, roughly 85,000 shares of premarket volume green is down. snap is upgraded to a buy rating they have $19 price target they think the recent stock selloff offers a buying opportunity there. outperforming. then we'll end here on shares of fire eye up nearly percent or so, roughly 9,000 shares of premarket volume the cyber security firm also gets upgraded to buy as well a lot of those names getting some of those pickups from analyst calls so becky, some of the names to watch in otherwise down take. when we come back the latest on the coronavirus outbreak. new york seeing more cases and

new jersey with its first presumptive case we have the details on that next check out the treasuries this hour, too that may be the key market that people have been watching. the ten-year oncage ain below 1% yielding today 0.967%. "squawk box" will be right back. our retirement plan with voya gives us confidence. they help us with achievable steps along the way... ...so we can spend a bit today, knowing we're prepared for tomorrow. wow dad, do you think you overdid it maybe? i don't think so... what do you think, peanut? nope! honey, do you think we overdid it? overdid what? see? we don't think so, son. technically, grandparents can't overdo it. it's impossible. well planned, well invested, well protected. voya. be confident to and through retirement. we have like 40 years of data! that's incredibly valuable! voya. be confident to and through retirement. ...i...i don't know... when did we introduce siracha? not soon enough.

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welcome back to "squawk box" this morning here is the latest on the coronavirus outbreak california now declaring a state of emergency, this after coronavirus cases shot up to 54, that's the most in the nation and governor gavin newsome saying a cruise ship is being held off the coast of san francisco after being linked to the first u.s. death outside of washington state public officials will now start to screen everyone on the ces n santa clara county and medical screener at l.a.x. classes were cancelled for 20,000 students in the seattle area the largest u.s. city to close because of the virus the superintendent says it will be shuttered for at least the next two weeks amazon and facebook are also encouraging employees to stay in seattle -- to stay home after workers for each company tested positive for the virus officials in new jersey announced the state's first infection increasing the total to 17 states the patient in new jersey is a man in his 30st. it's unclear how he contracted

the disease. new york also confirming five more cases all connected to a west chester county man bringing the total number there to 11 and the markets looking to open in the red in a very big way this morning in large part because the numbers keep growing. joe? >> andrew, thanks for the latest on efforts in the u.s. to stall the spread of the coronavirus, let's welcome dr. mark mulligan, director of nyu vaccine center and their infectious diseases and immunology division. doctor, thanks for joining us. focus on the prospect for widespread testing and whether you think that imminently we're going to be in a much better position to accurately decide how much of the virus is actually in the united states? >> yeah, diagnostics are such an important part of the response to an epidemic and we have to know who is infected in order to properly isolate them and trace their contacts i do think we're going to see a major up tick.

the fda did a wonderful thing on the past saturday when they made it more rapid for local hospitals to bring their own tests into use and we have more and more state and local health authorities, like the city of new york, the state of new york, now doing testing. so the answer is, yes. i don't know how quickly, but we're clearly seeing a ramp up that is a great thing. >> what was -- what did the fda change was it prohibited for local hospitals to use their own tests? >> what they did was to create a streamlined pathway for validation of tests by laboratories that had developed their own tests so they can actually, once they validate, do the initial. >> i saw that president trump pointed a finger at the obama administration for not having that rule. is that the rule you're talking about? >> no. what i'm talking about is during an epidemic we get special authorizations and guidances to respond. they're not needed all the time.

in response to this, it was needed and they did it and that's great. >> so we haven't had enough testing so far. >> >> correct. >> there's two schools of thought, one is that it's the tip of the iceberg that we know about because we haven't been testing. the other is that you don't see the anecdotal evidence of emergency rooms being flooded with symptomatic people that appear to have the coronavirus would we know if it was much more widespread than we think by seeing people come to the emergency room right now >> we might. it's a little tricky because we're in flu season. flu is waning. our positive flu tests, the percentage of all the tests that are positive on people coming in with respiratory infections is lower. that actually might be our signal that we're still seeing a lot of people presenting with respiratory illness, but it's not so high flu anymore at this point. flu goes down in the spring. so that could be it. and i do -- to answer your

question, i do think that the detected cases are the tip of the iceberg. i think there's more circulation going on we have some scientific evidence to support that in washington state based on viral sequences >> okay. so, then the next question is the way that china reportedly handled it, which it looks like they've gotten a handle on it to some degree, at least that's what they're telling us. >> right. >> that a nature of the virus itself that it is something we can deal with? or is it the draconian thing that china is able to do because it's a communist state and we can't do that here >> yeah. i think that we can deal with it we can mitigate it we can do our very best to control it there are very common sense public health measures we can do, isolation of cases, quarantine of contact, all doing our social distancing. we will need to do phases or

versions of what they did there, i think n terms of limiting social contact during this very unique, unprecedented time that we're facing of course, we're not going to do the most extreme things that they did, but many of the things that they do in terms of limiting travel and contact with others are things that are effective. >> dr. mulligan, how able is our medical system able to handle this just determining -- based on the number of cases that might be coming through. we heard from some hospitals that they're already pretty full without the coronavirus. >> that's right. and that's how it is every year during respiratory virus season, during flu season we tend to fill up our hospitals, our icus, older people, people with respiratory illnesses are in the hospital so, i think our hospitals have capacity to absorb a large number of cases, but it is also possible that we will exceed their routine capacity in that case, most hospital

systems have made extenuation plans where they can make new wards or handling of patients. the worst case scenario, we exceed our second level expansion capacity >> what about staffing in those situations because we know we have shortages of ventilators and of masks and things along those lines but i also know from people who work in hospitals they'll see 20% of the people call out if there's a snowstorm. what do you do if people get worried about coming into work because of the coronavirus >> right i think that we might have a shortages because of the exposures and people have to go into quarantine. maybe workers who are coming to work get exposed on the way to work some case was on the subway, something like that. i think it would be a shame for health care workers not to show up for work because they wanted to avoid the situation i think they have tobelieve that the personal protective equipment and the measures, the operating procedures we have in

place work we know that personal protective equipment can be highly effective. the things that the doctors, nurses who will be taking care of patients will wear, those work >> are you in a position to give an opinion on what the actual mortality rate is? >> yes. >> what do you think it is. >> do you think it's as high as the w.h.o. said? >> which figure? because the figures are changing all the time. >> 4.3%, but that was worldwide. >> 4.3 >> what do you think it really is >> my opinion is that -- that the denominator is much higher and that the percentage will be lower. we actually know from some of the reporting that the mortality rate in wuhan itself was over 3% but that everywhere else in the globe was closer to 1%. >> why >> my feeling -- >> well, because the reporting and the cases that were appearing there were the severe illnesses. all the people doing well, remember for 80% of us f we get

this, younger healthy people, we're going to do just fine. children do extremely well with this there have been no deaths reported with children under 10. let's keep this in perspective 19,000 people have died of flu already. we had 29 million flu infections. >> we didn't rush any of that stuff on the air that is a difference we try to do what we can, doctor considering both sides thank you. appreciate it. >> you're very welcome. >> much more on "squawk box" when we come back, we'll be joined by david booth for his take on the recent market swings. > d ff>>anjerey it inle, the ceo of air bus america will join us from the chamber of commerce aviation summit. stay tuned "squawk box" will be right back.

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futures under pressure major indexes deep in the red premarket as extreme volatility reign on wall street. this hour, we'll tell you where you might put your money to find value. da oversees more than half a trillion dollars. and the growing coronavirus pain for the aviation industry we'll hear from the ceo of air bus americas

the final hour of "squawk box" begins right now good morning and welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square our guest host sam zell. u.s. equity futures at this hour are now down over 600 points on the dow. indicated down about 75 on the s&p. the nasdaq down 225 or so. that's giving back about half of what we gained yesterday, which got back about twice what we lost the day before, which went down about half of what we lost on monday. i got that right, sam? that's about right >> roughly. >> roughly treasury yields we haven't

gotten back -- >> exact it's off by 70 points. >> .96 there's nothing to the left of the decimal point. >> that's wild it's wild. >> first time. >> and then crude oil prices, opec putting out a press release confirming have agreed to 1.5 million barrels to cut in oil production this is an idea, becky, that maybe we just keep santoli all the time he can be standing in front of the. >> he is the only one who can properly write >> need a guy off to the side that once in a while for comic relief. >> no, no, no. off the side who then joins us at the table for the rest of the time. >> do you remember how many pot jokes he had to be subjected to by carson. every night. now it's assumed

any way. >> let's get caught up on the latest coronavirus headlinings around the globe cases totaling more than 95,000, more than 3300 deaths. more than 150 cases reported and 11 deaths in the united states california declared a state of emergency after a coronavirus-related death in that state yesterday the house, the u.s. house, passed more than $8 billion emergency spending bill aimed at prevention and preparedness measures and vaccine development. that bill now heads to the senate and in the meantime, facebook confirmed contractor based out of a seattle office tested positive for the virus facebook closed that office until at least the next week and encouraged seattle employees to work from home. microsoft is telling its employees near san francisco and seattle to work from home for the next few weeks as well and the conference fallout from the coronavirus continues. apple will no longer attend the south by southwest festival in

austin, texas, this month. >> i have to tell you, they shut that whole thing down which they say they're not going to yet. >> i don't know how they don't. >> but the damage to austin. >> you think about the damage to a lot of these places. >> is huge. >> i have to say, andrew, devastating. >> the biggest weekend of the year. >> but i watch the things that are being shut down, another thing i was supposed to be doing, got cancelled today you have been saying the same thing. constant cancellations of anything that's out there. >> i was supposed to be on the road next week two weeks from now it's a constant issue. >> now it's affecting me then. >> now it's affecting you. you're stuck here. >> no, i was going to go next week skiing. >> you're not going? >> oh, i think i need to be here and i don't really feel like -- but you're not going to be out of the office anymore? >> you know, i'll be right here. >> that's just super. >> you cancel skiing >> i did. >> because of -- >> because i think the markets going to be i think this whole

thing is still happening by next week >> i think if i went to colorado i might stay there i might whole up in vail and never come back. >> you'll come to times square everyday >> i know. i honestly don't feel like taking a plane out there, honestly. >> you have had some concerns yourself. >> unless they remove the tray tables. >> call me in two weeks. >> so you haven't cancelled these things yet >> a couple of things i have cancelled. things today i cancelled question is how far out? >> in real life things like this are happening. >> it's rolling, yeah. we'll see. meantime, the broader market yesterday took the latest virus news in stride the dow surging more than 1,000 points for the second time this week futures are much lower this morning. you can see where things stand right now. cnbc's senior market mike santoli looking into the jumping trading range as he joins us now with his take and then i have a question for you. >> sure.

andrew, shows you if has zard of trying to tell the specific story of what's driving the individual daily move. look at the s&p 500, stint, since june 30th of last year this captures a lot of the ups and downs. obviously this is the very range we're talking about. this is the s&p. it's going to be down half of yesterday's advance. so that's down another 75 points what we have been doing is trying to see if this area, which was kind of the highest from the summer and then the lowest from the summer where friday's lows actually if you wanted to look where we bottomed out early on friday. we're trying to see if that's going to provide a little bit of a buffer right here. what really is clear is that that december, january kind of levitation, that's been wiped away now as the market is trying to find some equill librium in this range, obviously in a relative news vacuum in terms of what the fundamentals are going to look like this is an unusual aspect of the decline and rebound. if you look at a one-week basis

of the s&p low volatility etf, these are stocks specifically selected to move less dramatically than the s&p itself they actually have been up on up days more than the high beta the aggressive stock which you expect when the market is swinging a lot is going to be more spring loaded what this largely means i think in part is a yield story so the market is kind of hunting for sustainable sources of yield given where bond yields have gone to. but also suggests maybe it's not a vote of confidence people really want to go out on a limb and say the economy itself is going to rebound very quickly from whatever we're in for so this is a little upside down scenario very rare to see big upside days we have seen when you have the very defensive stocks leading the way. >> how much do you think this is -- we were talking about this before how much do you think was virus yesterday? >> yeah. >> either some kind of acceptance of it, though today there isn't. or really politics whether it was the biden win and what the sort of -- sort of fat

tale risk of sanders being removed or lessened. >> look, they didn't take any delegates away from biden overnight and given up half of yesterday's gain not to be glib about how it's not a factor everything is a factor look at the health care stocks 100% that was biden over sanders move as far as the broad market, it's not terribly unusual after you get a record fast 12% correction from an all-time high to have the market kind of be fibrilating this way and latching on to the latest bit of hope or fear that comes across the tape i think that's what we're looking at so the day before yesterday there was this reaction that seemed to say the fed does not have the ammo or the enemy we're facing right now where as yesterday it was, guess, what, maybe the economy will be fine this will be a brief pause we just got a half point rate cut we didn't necessarily need that's bullish i think all those explanations have merit but really it's just the market trying to swing around some vague estimate of

equilibrium right now. >> mike, thank you for that. joining us for his perspective on the market, legendary investor david booth is. he oversees more than half a trillion dollars in assets good morning to you, david. >> good morning. >> help us understand how you have been thinking about these market moves and the impact of coronavirus and the feds moves as well over the past week >> well, you know, of course market volatility isn't anything new. we have experienced it every year basically the -- in fact, it's a lot like where we were a year ago at this time if you recall at the beginning of last year the market had been down quite a bit, and people were stressed out. and similar to what they're doing today. the way they are today and what happened? the market was up 30% or whatever, bond prices went up.

so, what that points to is you want to stay invested. and i think the good news in our view is, in all of this, is you don't have to forecast a short-term fluctuations in order to have a good long-term experience you always want to keep focussed on long term outcomes. and the way you do that is figure out what your goals are and figure out what kind of investment mix makes the most sense for you. >> right. >> you can't control markets but you can control the amount of risk you take. >> can you speak to what inflows and outflows you had in the fund over the past week >> it's been largely flat. >> largely flat? >> yeah. i don't have the exact numbers modest outflow i would say the last few weeks nothing -- see, our type -- our clients have bought into this kind of philosophy that you want

to stay invested you shouldn't have to make dramatic changes very often. that being said, this may be one of those times you may want to consider a change in the sense that the vix has gone from 15 to 40 to whatever the last week or so that's a huge shift. so you may want to go back to basics, relook at your asset and figure out how much risk you're willing to take. returns in essence are not that predictable, but risk is or volatility is somewhat predictable. and so that being said, it looks like over the next period of time volatility is going to be with us for a while. >> isn't there a much more specific element to it i mean, you can't sit there and say let's sit there and relax if you're in the hotel space or the airline space or you're in a particular space that's being

impacted very directly by the virus. you know, there may be supply chain problems in certain kinds of companies, but that's very different than the consumer or your customer's instinct and saying i don't want to take the risk of flying on an airplane with a bunch of other people or i don't want to go to a hotel. i want to in effect stay as clear as i possibly can. and i think those kinds of companies are likely to have a much more significant risk factor than the overall market >> well, the question is how does all that get priced out you always have to remind yourself markets are where buyers and sellers come together in a voluntary transaction they elect to get a good deal or don't trade. you look at the market mechanisms, market trading volumes, everything looks like normal. >> does it seem normal to you.

how anxious are you about the steps the fed has taken in the past several days? is that the right decision >> well, we can debate how much influence the fed has over long-term returns. here again, a year ago they had been raising rates and rates dropped. >> you don't think the fed has a huge impact on long-term returns? >> no. i think it can come in and affect liquidity and affect short-term outcomes quite significantly, but i don't think it has that much influence other the long haul. >> what do you think about -- what do you think about the ten-year falling below 1%? just some of the big moves i know that we have seen a lot of volatility, but the volatility has recently stepped up. >> yeah. here again, you have to come back to with careful planning you consider a lot of these options. but if you look at what really

counts is your aftertax real return the yield minus inflation. >> right >> and it's kind of in historic levels. >> because inflation is so low >> yeah. yeah >> but certainly lower interest rates than we have seen incredibly low interest rates for a decade at this point but watching these rates continue to be this low and even fallower, that is a lot of long-term investors even thinking, wow, this is a different scenario than anything we have seen before. >> well, it is but you can't control markets. i mean, that's -- you have to keep focus on what you can control which is in the simplest form how much do you have in stock versus risk assets that sort of commitment. in today's heightened volatility, you want to kind of refresh your look at that and make sure you're not taking more risk you know, what you don't want to have happen is people get totally stressed out and exit the market i mean, people i feel sorry for, those people in march of 2009

couldn't take it anymore, got out and they'll never get back to even. >> yeah. >> but i think the other question is if you have cash on the sideline, would you be putting it to work right now >> sure. >> very much yes >> yeah. you have to figure outyour -- look, you have to make decisions under uncertainty everyday in all kinds of circumstances you just make the best informed choice you can based on science and what you've learned from the past, based on my 50 years of experience of studying these things, every year the source of volatility is different. last year we were talking about brexit all the time. and i think for the average investor you have to rely on market pricing the market prices are -- thing

reget the hundreds of thousands of investors out there trying to do the best job they can >> okay, david booth, thank you. nice to see you. appreciate it. >> thank you >> you bet. coming up, an exclusive interview with the ceo of air bus americas as aviation heavy weights deal with the one of the most uncertain times in the industry in years. we want to draw your attention to shares of zoom video, the conferencing stock is down sharply in the premarket even though it beat analysts estimates for the fourth quarter. zoom have gotten a lot of attention lately for being a potential stay at home stock that could benefit, could see a benefit from the coronavirus be a shame if you bought it on that it is happening. money goes downhill. as we head to break, a reminder you caalys wchn waat or listen to us live on the go on the cnbc app. stay tuned we'll be right back. when we started our business

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ask. shop. discover. at your local xfinity store today. welcome back let's get back to our guest host to talk strategy amid all the recent market uncertainty. sam zell is here the chairman of equity group investments is opportunistic and knows how to

look into volatile times and take advantage of it sam, part of what people are trying to figure out is how much of this is fear of what might be coming and then how much human reaction based on that fear does it really change the reality of the economics. >> i would start by saying that human reactions creates the scenario so if everybody gets scared of traveling, you're going to see a dramatic reduction in travel justifiable or not you know, i remember 9/11, i don't know maybe it took three months before people were willing to fly internationally i mean, i had a director of one of my companies from england and after 9/11 he said i literally flew -- he's from london he said i flew on an empty plane. >> commercial empty plane. a commercial flight that was empty. >> a commercial flight that was empty. and i just think this whole concept of mobility and so much

of our society, you know, has been built on mobility and tourism and, you know, traffic and sales at luxury department stores. >> even restaurants, going out to the movies. >> yeah. although interesting i'm surprised at least so far i have been in a lot of different restaurants. i haven't noticed any change in restaurant activity. >> was that in chicago >> los angeles and chicago and new york you know, i'm not seeing -- i'm surprised. >> that's also because we only have 100 reported cases. do you think that changes if you get 1,000? it's happening in seattle and the surrounding areas there. >> do you really think we only have 100 cases >> no, we have 100 reported cases. >> you know, you would think so. i just -- i think we're all in uncharted territory.

mr. booth's comments, you know as i said, we're missing the word uncertainty but there's an enormous uncertainty issue that nobody seems to be in any ability to narrow it down. >> you already told us earlier this morning that you are being opportunistic in places like the energy field but when there's so much uncertainty in some of these other areas, it is too soon to -- >> i think it's -- people always ask on real estate, you know, what market are you buying i don't ever buy a market. you buy a deal in the same manner, you look at what's going on and you have to -- you are forced to make a decision on your judgment on that particular situation. we just killed a deal -- but deferred a deal that we were almost ready to close that was dependent on exports of food

and you know, the question is this a good time to be in the export of food business. >> let me ask you, did you defer that deal because you think the export of food business is going to be ir remember bli damage or did you defer it because the terms you were about to set was based on a different reality did you want better terms at this point >> well, part of the question is what terms should i ask for? >> right. >> in other words, is this three-month disruption, is this a six-month disruption is this a multi-year disruption? is everybody in the world going to get the vaccine >> that's not necessarily off the table. it's not going to happen at the price you had been talking about before. >> part of the question is, you know, price discovery is based on fact. >> right. >> and i can't imagine a scenario where we're less fact governed than the one we're trying to deal with today. >> how many deals, i have been

trying to get my arms around this, i hear this from a lot of people who are putting deals together, how many deals are put on hold, large ones we wouldn't known too much about >> i'm not sure there's much difference between the term hold and slow in other words, i think nobody is ready to say no nobody is ready to say i know enough to know i shouldn't be doing this. >> but i also don't know enough what i should be doing. >> but i also don't know enough as to whether i should be doing it, degree to which i should be doing it i think that there's so many variables and frankly the data so far is so minuscule do we have 100 cases or do we have 1,000 cases and even if we have 1,000 cases, 330 million people, 1,000 cases doesn't sound like a lot of cases. i don't know the answer. but part of the whole

environment today is not knowing the answer. >> right. >> and when you don't know the answer, that's why the stock market is acting like a yo yo. >> right >> on monday you wake up, i feel good today i'm going to correct the mistakes of friday then tuesday morning i wake up, oh my god, i was too opportunity mystic yesterday i'm going to pull back that's literally the kind of scenario we had two 1,000-day moves. >> it's thursday. >> we only have three days and two 1,000 point moves. >> 725 today. >> now it's 725. yeah so i think that this is enormous uncertainty. >> all right. >> but you're not seeing conclusions. you're seeing caution. >> sam zell is our guest host. we'll have more from him when we come back. a lot more of the latest reads on jobless claims and productivity, breaking economic

data all due out a the bottom of the hour futures are at their ssieson lows right now, down 700 points if we opened up. we'll be right back with more.

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welcome back to "squawk box. right here on cnbc we're live at the nasdaq market site in times square we're just a minute away from the latest jobless claims data and a new read on fourth quarter productivity let's show you the futures right now because it is not a pretty sight. looks like if the dow opened up right now would open down 731 points right about now the s&p 500 looking like it would open down about 86 points. the nasdaq looking like it would open down 251 points rick santelli is standing by at the cme in chicago ahead of the data and before you hit us with these numbers i'm curious about where you think the equity market and the ten-year are, in particular, we should show you that as well right now, rick i know you have a take on all of it >> yeah. i personally think we're going to see a lot of 1,100 point up and down sessions for a while, but i think at the end of the day, that there's going to be a resiliency to the equity markets and of course the longer it lasts the more the volatility will last.

but ultimately the deviner in my opinion of an all clear will come from the global sovereign market the yields are too low and i don't think they're too low necessarily for the back channel of economic activity i think that the drain of safety via globe fearful of negative and lowering rates is the reason to attacks of the coronavirus by other central banks will ping-pong back and forth until we see these yields ease up a bit, i think the yellow light stays on in terms of jobless claims, i'm a bit surprised that they haven't popped a bit higher. >> higher! >> the coronavirus may indeed be incubating here and the numbers are going to go up, but i certainly think there's a little more hysteria than warranted 216,000, actually down 3,000 on claims continuing claims actually are very lateral basically from 1.72 million to 1.729

fourth quarter productivity, 1.2, darn close to expectations, couple tenths light in the rear-view mirror do remember when we look at productivity, this is going to be affected more on the global basis in my opinion of late. and we look at unit labor costs associated with those productivity gains, they were easing back, only .9 so, labor costs .9 productivity about in line the aftermath here we see that we're sitting at 60 bases points and two-year note yield, among the lowest intraday levels going back to the summer of 2016 for a two-year, ten-year note, 90 is the intra-day low in this series that, of course, was from tuesday. so we want to pay close attention. we didn't take it out yesterday. we're getting very close you also want to keep a very close eye on the other central banks. great article in "the wall street journal" today.

christine lagarde and company are more put in the box by us getting in front of the coronavirus from a central banking perspective before we have any of the returns in and i think that this is going to be an on going issue. no what ter what christine lagarde says or any of the ecb members tell you, they have very little ammunition left and if monetary policy becomes the tools to try to combat a coronavirus and i understand the very weak link to the economy without any facts really being known, it is just going to make it worse they're going to be put to a spot on their rates and their policy where there really isn't any room for any economic expansion much less a backside to this that truly has economic negative consequences versus health negative consequences there is a thread there. becky, back to you. >> all right, rick thank you very much. steve liesman is here with more on this right now, too. steve, what do you think not only about these numbers but

what rick was just saying act christine lagarde being put in a box. >> right so let's go back to the video tape of warner wolf was said >> then his teeth fell out a couple times. >> hopefully mine will stay. >> yeah. >> you have the g7 statement on tuesday morning? >> uh-huh. >> and that basically said all central banks will fulfill their mandate. remember the market got really upset that there was no policy action in there? >> talk talk talk. >> i have never seen the market be so wrong in its assessment, right? because the g7 by itself has no policy to cut, individual central banks have policies to cut and treasuries and mint finance treasuries have money to spend. g7 has nothing, just a collection of people >> yeah, but that's where all the talk from the friday and the weekend before people thought, okay, they would coordinate something maybe. >> right >> central banks >> okay. so, two and a half hours later the most important central bank in the world cut interest rates by 50 bases points.

>> we didn't coordinate. hey, do it but good luck >> this was a very similar statement to the one they put out on the financial crisis. not word for word but very similar. bank of canada yesterday >> you're the only one who remembers that >> and next week getting around to answering your question, ecb is going to step up. >> yeah. >> and that's going to be something unclear about how they'll do it but the owness is on them. everybody expects them to move what you see is 100% chance that the fed goes again at the march meeting. >> at the meeting in two weeks less than two weeks? >> that's what the market is priced at. 80% chance call it of a second cut in april this is kind of new. a third cut, so let's count it up, 25, 25, is 75. 50 so the expectation in the market is for 125 bases points total of

coronavirus credit cuts or federal reserve cuts >> 125 when you start at 100. >> right, exactly. that gets you to negative. >> negative territory? >> exactly not negative -- negative is not priced in. another 75 from here the new range, if that is correct if you want to say how the market is priced, it's to get to the range of 25 to 50 >> so, if the fed has put the ecb in a box, what is the market doing to the fed with this >> the market is putting the fed in a box, right? i think that's the question you're asking, right so what happens now is, look, you have to have these guys speak and they will eventually in terms of what they're expectations are, bullard yesterday was quoted saying the 50 the fed makes a rate cut in march less likely but a bunch of feds speak today and a bunch of feds speak tomorrow. can i ask sam, i know you talked

about this earlier, will it do any good do you support what the fed has done here? >> i don't know that it's going to make much difference. i think it's got a much more psychological impact than other. that's going to affect somebody doing something. but, when priced as low as they are, frankly other than in a trade or something, i can't speak to that. >> by the way, this is coming from a real estate guy >> yeah. because it really isn't -- you know, it's like when libor was very low and all of a sudden every loan had a libor minimum never had a libor minimum before all of a sudden there was a libor minimum. i wouldn't be surprised if they cut rates and put in minimums that effectively counter exactly what they just accomplished or

tried to accomplish. >> who puts in the minimums? >> lending institutions. basically saying at least this week interest rates are negative or interest rates are very low we're not lending you this week. >> we're not recognizing. >> you're not buying floating rate debt. so therefore if you want, you know, or maybe you are buying floating rate debt if you want debt from us, you need to give us more protection. >> promise we'll make money. >> than just based on today. >> aren't you the president. don't you want to be paid to borrow >> i never admitted the condition pay to borrow. >> we talked about it the other day. you saw there wasn't a direct -- >> come on if the president wants to take a loan out one of these days and get paid he would like that >> i covered real estate guys my whole life i know what -- >> guys like really cheap debt

like long duration debt, all of those are a lot more relevant than a short-term opportunity to be on the receiving side >> do you remember that talk you probably do. >> oh, that's right. we're back to that again do you remember who it was >> i didn't try to this time. >> i think one -- >> who was it? >> brewer and shiply we have to go. all right. thank you. i'm going to introduce lebeau. >> more phil is better. >> aviation industry being hit by a one-two punch the grounding of boeing 737 max and the coronavirus, the international air transport association this morning said that the global revenue hit to airlines this year could reach $113 billion industry executives are trying to navigate one of the most turbulent times for their business in years.

and phil lebeau joins us now from the 2020 u.s. chamber of u.s. aviation summit with an exclusive guest. phil >> hey, joe. let me bring in jeff knittle we were talking as you were listening to the conversation here, we're in a strange time both in terms of the market and in terms of the airline industry let me start first off with coronavirus. you saw the estimate from the international air transport association dramatic increase in terms of what the revenue hit will be to airlines. >> yes. >> what's your perspective right now? >> i think one, you have to look at it from a long-term perspective. and i think airlines are doing that the reality is they're making short-term adjustments to their schedules to ensure their financial strength i would add, phil, by the way, the airlines have never been financially stronger to handle an event like this so they're making short-term adjustments to address this problem. i don't think it changes the long-term aspects of their

strategic plans or ours, quite honestly but they have to look at the current situation. >> you have been in this industry a number of years, i won't say exactly how many, but you've seen sar-s, after 9 sl/1, give me your perspective how you think the man shakes out >> the reality is we have seen some type of v-shape return after all of these now, after 9/11, it took a little bit longer. but you also have to remember the airlines at that point in time were in very poor financial states and there was a lot, a lot of uncertainty i look more at sars as an indicator of how this could shake out. now, our expertise in this quite honestly comes from the true expert, the world health organization, the cdc and their recommendations and what they see and how they see it playing out. so, we rely on them as the experts and we adjust our business plan to that. >> but as of right now, you're

not changing either your production schedule, what you're planning or changing what you think is likely to be the order demand rate over the next year or two, correct? >> not at all. quite honestly, we were in a situation where we were with -- with 7,500 airplanes in our backlog, we were pushing hard to keep up. so we don't see any short-term issues from that at this point. >> when you look at your plant down in alabama and you'll have the a-220 plant fully on line by august, do you have to modify operations at all given what's going on with coronavirus? >> no, not at all. i mean, circumstance can change obviously. but as of today, when we speak with the expert, and when we look at where we are in terms of our plans, we intend to deliver our first airplane, the 220, out of alabama in august to delta airlines and we're continuing to ramp up our productions on the 320 to -- from six a month to seven a month, delivering close to 70

airplanes. >> jeff knittel, you are busy. a-220 the first being delivered in august. and then you have to navigate coronavirus. guys, we're at the summit all day long we'll talk with a number of airline ceos this is we're in that capacity cut range right now. you'll start hearing from airlines either expecting hits in revenue and/or at the same time cutting their capacity for the second and third quarters if not for the rest of the year guys, back to you. >> phil, thank you very much. this morning we remember a business legend, friends, family and business leaders are gathering here in new york city at st. patrick's cathedral to pay their respects to jack welch, changed the way american corporations operate and oversaw a period of tremendous growth at general electric and also a close friend and mentor to many people here at cnbc. robert frank is outside st. patricks and joins us with more. robert >> reporter: good morning, becky. this mass for jack welch expected to start in 20 minutes at 9:00 a.m.

already the number of people in top leaders in business and finance and media just incredible how many lives that jack welch touched, that he improved, that he impacted as both a business leader and ceo and as a mentor and partner to so many people i want to show you the program from this morning's, which the list of pallbearers shows you the impact that jack welch had on so many people. so included in the list of pallbearer this morning, mike barnacle, co-wrote the book with jack welch "straight from the gut" bill belichick, larry, andy lack, david zaslav, eulogies from many of the family members as well as ken langone and mike barnacle again, the number of business load leaders, finance, media, coming in this morning, just incredible how many people he touched and i thinkthat's

really what today will be all about as well as hearing from mi mbe, dren, stepchildren and falyemrsguys. >> robert, thank you very much "squawk box" will be right back

welcome back to "squawk box," everybody. the futures this morning have been under pressure all through the session. in fact, right now we're at the lower end of that. we have seen down 700 but right now the dow is indicated 670 points coming after gain of more

than 1,100 points yesterday for the dow. s&p futures right now down by 80 nasdaq off by 270. the dow's big swings giving wall street some whiplash. with two 1,000 point gapes this week alone and 1,000 point drop last week, here to talk more about where investors can look for opportunities, darrell kronk, chief investment opportunity of wells fargo wels and investment management. you like it or not does it give you opportunity or add to that? >> no, we like it. matter of fact, earlier this week we took a fair amount of money out of short duration fixed income because we thought fixed income was overbought at this level, put it back into large and mid-cap equities in the u.s. >> when did you do that? >> tuesday happened to be the down day, up yesterday and back down thursday we'll see. you have to track the levels the interesting thing here is no matter how volatile the equity markets are, if you look underneath, there aren't as many

signs of stress and strain as you think. >> the ten year below 1%, energy prices below $50 a barrel? >> they are. but they stabilized here this week, right? oil stabilized around 47 -- exactly. there isn't signs of stress on the short side of the yield curve yet either so the repo market is not showing signs. counterparties are not stressed at this point. u.s. dollars found a tight range here so we'll see but equities still are all over the place. >> rates are this low, people talk about equity prices and they worry that it's because rates are so low. >> right we attribute moves to safe haven buying ten year at .97 or .79% is safe. you could lose your butt in that, couldn't you, sam, in a ten-year, three years from now rates were up and got less than -- that thing will be worth $800. >> but what do you do

refinance something today with a five-year butt or three-year butt and you refinance it today with a ten-year and 9.7 and three years from now the ten-year is 2.5? now, the ten-year is aren't we lulled into a false sense of security about the bond market what's riskier, the stock market or bond market >> looking at valuations you would have to say bonds are more over valued than even stocks are at this level. in our opinion the one-year is at 54 bases points even if you get 2% yield on the s&p 500, you know, you're still yield to yield much better even if you get no appreciation >> margin calls are scary, what happens with all the debt that's outstanding, the floating rate debt, your debt service could triple. >> it can. it can >> that could be a problem. >> i think one of the things we watch really close is the issuance market has kind of

dried up the last couple weeks not surprisingly, right? people are not able to come back and issue new paper and new bonds when the market has seen this stress. >> despite the fact the rates have gone down. >> despite the fact rates have gone down. excellent point, sam so we need that to open back up, right? that's a key issuance market has dried up. liquidity is your risk here, it's not the absolute level of rates. >> despite the fact that liquidity has never been greater but the individual decision-making liquidity is critical. >> just this last week we've seen 20% outflows out of the high-yield etfs of the total asset value. >> it went down the wrong pipe, that's why i'm coughing. don't worry. it's from drinking it's not from the coronavirus. it's from drinking water >> you've got to stop drinking during the show. >> well, sam, you're the one who brought it. >> yeah, you're right. >> we cannot get through probably a segment without talking about --

>> coronavirus >> yes do you -- at your shop when you have sales meetings or strategy meetings, do you have a doctor come in? what do you -- >> we have. >> you have? >> epidemiologists come in and give their best estimates on models and that type of thing. >> really? >> yeah. but it's so hard to predict. there's no good comparable you have to watch the capital markets for the signs of strain more so than -- the reality is viruses don't respect borders, nationalities or governments. >> or technical analysis that's what i wonder about sometimes. >> or certainty. >> or certainty. the ultimate -- you know what it is, we talked about it earlier this year. there's unknowns and then there's unknown unknowns we've got an unknown unknown you don't worry about the unknowns, you worry about the unknown unknowns. >> but sentiment positioning and technicals do matter. >> i think so too. i buy that but we're back to the

question of whether you think the lows are in on this pullback >> actually we do. 2850 seems like a solid technical support level. we haven't retested it we may retest it again before it's said and done but if 2850 holds, then you've got a durable bottom forming, we think. >> ha, you, that was not me! >> i don't know if i can sit on set anymore. i'm worried. >> we've talked about garden variety corrections. a pandemic seems like you shouldn't have one of your normal annual -- that it could be more significant than a garden variety correction. we haven't done it yet on any given day we could make new lows theoretically. >> on any given day coronavirus is the reason to be up because cases have come down and today it's the reason to be down, right, because you saw the state of california declare emergency, the city of los angeles, spikes in south korea and italy in caseloads again. >> 666 now, perfect.

anyway, darrell, thank you >> i swear it went down the wrong pipe. >> excuse me let's get down to the new york stock exchange now where our good friend jim cramer joins us. hopefully he's not coughing. jim. >> no. look, i wish i could be as optimistic as your previous m rk like everybody else, your instinct is to say i really don't want to go out i've got a fund-raiser tonight, i'm looking forward to that. but i think to myself, geez, a gathering place is not where i want to be it's amazing how quickly things -- how sentiment changes when you read what's happening in the state of washington, which i think is pretty bad. or another cruise ship holy cow >> jim, but what i don't get about this is you had a terrible day two days ago then yesterday things seemed to come back. now we're down again wasn't it clear that this was going to be exponential?

>> what happened on monday, we had a huge day >> i think the existential fear of bernie sanders being the leader of democratic party, the standard bearer, i think was diminished >> you're with blankfein on this, yesterday was a political day? >> i think there were a lot of people that lot bernie sanders would get the nomination other people felt that a socialist at the top of the ticket would be very bad for the democrats. there was a kind of a -- i think there was a sigh of relief that a socialist is not going to be at the top, at least right now we don't think but look, there's some companies like splunk reported a great number now it's time because of the futures. there are some stories that are good that were reporting but a lot of people say, wait a second, is the state of washington looking like china? i think it's very frightful to read the stories and know we don't have the teftsts. we're all just reading news and reacting i don't think we can offer

anything in particular that gives us any comfort because there is no comfort. >> but when you look at -- we were talking about travel plans. so many of these conferences are now getting shut down. people -- joe just cancelled a trip to go on vacation. >> there's a lot of variables with that. >> we just cancelled our vacation. >> what did you say? >> we just cancelled our vacation. >> you did when was that supposed to be >> in two weeks to go to florence >> okay. >> that's italy. would have said, sure, italy is great. two weeks ago you would have said florence is great and then florence is closed. italy is terrible. how did that happen? but it happened overnight. i think our fear is if it happened overnight there, why wouldn't it happen overnight in other countries? italy is not particularly a place that has a terrible health care system. so i think that we're all -- >> i don't want to do doomsday but i want to understand your doomsday version what do you think the low could really be in terms of how the markets will take this

>> remember, i think that there was a huge percentage of the actual s&p is made up of companies that are relatively immune or immune and then there's travel and leisure, which i can't find the bottom i thought that when i listened to phil's reporting, i'd come back and say, well, i don't know even though the airlines may be in the best financial shape, you can only run planes at a -- with a small group of customers for so long before you really get in a lot of trouble same thing with cruises. i mean do you want to go on a cruise, andrew >> no, but -- >> you couldn't pay me to go on a cruise right now. >> i could see it in the travel industry we have retail even the facebooks of the world, at some point you're not going to advertise if you can't get the customer, even if it's all delivered at home. >> i'm not disagreeing. >> jim, a lot more from you. we'll look forward to that in a couple of minutes. don't miss the interview a little later with the president and ceo of hp after the company

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it's been a pleasure. >> what about a side car on your motorcycle i want to get the hell out of here. >> i don't know if i have enough sanitizing equipment to do that. >> anyway, it's good having you here. >> thank you, sam. >> that does it for us today make sure you join us tomorrow right now it's time for "squawk on the street. >> announcer: this is cnbc breaking news, market sell-off >> good thursday morning, welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber coming off wednesday, they are giving about half back state of emergency in california, cancellations from google, apple, netflix and more. 10-year down 95 basis points uncertainty beginning to weigh on the street. stocks going to open lower. >> plus hp rejects the